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| Coal mines secure pension rescue deal | Coal mines secure pension rescue deal |
| (35 minutes later) | |
| UK Coal has announced a restructuring of its mining operations, which it says will secure 2,000 jobs. | UK Coal has announced a restructuring of its mining operations, which it says will secure 2,000 jobs. |
| Under the reforms, the company's pension scheme will be taken over by the Pension Protection Fund (PPF), the safety net for troubled businesses. | Under the reforms, the company's pension scheme will be taken over by the Pension Protection Fund (PPF), the safety net for troubled businesses. |
| It is set to be the biggest rescue so far by the PPF, and is an attempt to avoid major closures and pension cuts. | It is set to be the biggest rescue so far by the PPF, and is an attempt to avoid major closures and pension cuts. |
| However, 350 jobs are being lost, and some staff will see a 10% reduction in their pensions. | |
| UK Coal has been suffering significant financial difficulties, and underwent a restructuring last year. It suffered a costly fire at the Daw Mill pit in Warwickshire earlier this year. | UK Coal has been suffering significant financial difficulties, and underwent a restructuring last year. It suffered a costly fire at the Daw Mill pit in Warwickshire earlier this year. |
| It has operated two deep mines and six surface mines under UK Coal Operations, which is a subsidiary of UK Coal Mine Holdings. | It has operated two deep mines and six surface mines under UK Coal Operations, which is a subsidiary of UK Coal Mine Holdings. |
| Both of these businesses will now go into administration. However, the viable mining operations have been restructured and their assets will now be held in individual employee trusts owned by a new business which will operate as UK Coal Production Limited. | Both of these businesses will now go into administration. However, the viable mining operations have been restructured and their assets will now be held in individual employee trusts owned by a new business which will operate as UK Coal Production Limited. |
| Pension details | |
| The business represents a large part of the UK's remaining coal mining industry. | |
| Under the pension deal: | |
| "We are very pleased to have been able to work with the company to put together this innovative plan," said PPF executive director for financial risk, Martin Clarke. | |
| "It means that pensions have been protected, the company can continue trading as a going concern and that 2,000 jobs have been saved from an uncertain future. | |
| "It became clear to everyone involved very quickly that, whatever the future held for UK Coal, its pension scheme would come into the PPF because of the size of its deficit." | |
| Kevin McCullough, chief executive of UK Coal, said: "Today is very much a day of mixed emotions, but this is the best outcome that it was possible to achieve. | |
| "Entering administration and the subsequent restructuring was the only way we could preserve any of the business and while I am delighted we have saved 2,000 jobs, we have also had to make some very difficult decisions." |